ACCOUNTS PART-2 Classroom Exercise Double Entry Accouting and Trial Balance Exercise 1 Ms. Jackson is a VAT registrant that operates an hardware store on Regent Street, Georgetwon. Her recorded transactions for the month of May 2017 are as follows: 1-May-17 Started business with $2,000,000 in cash from her private funds into her business. 5-May-17 Purchased 1 Computer Server for $600,000 on credit from InfoTech (no VAT). 8-May-17 Imported goods from LT Inc. in Trinidad for $4,000,000 on credit (Cost, Insurance & Freight), paid, with cheque, the Guyana Revenue Authority $300,000 duty & $100,000 VAT and $50,000 to transport the container to her business premises. 8-May-17 Sold goods for $5,700,000 by cheque, of which includes VAT charged at 14%. 15-May-17 Returned goods to LT Inc. valued $200,000 17-May-17 Paid LT Inc., via wire transfer, in full less a 5% discount received. 22-May-17 Sold zero rated goods on credit to Micky Tan amounting to $200,000 24-May-17 Micky Tan returned goods valued $10,000 26-May-17 Micky Tan paid his account in cash, less a 3% discount offered to him. 27-May-17 Paid Rent, $75,000, by cash. 27-May-17 Bought zero rated goods for $200,000, on credit from ABC Inc. 28-May-17 Took $60,000 cash for personal use. 31-May-17 Paid Info tech for Computer Server, with cheque. 31-May-17 Ms. Jackson computed depreciation of $2,500 on th Computer Server. 31-May-17 Received invoice from GPL (utilities) for May for $50,000 that is payable on June 10, 2015 (assume Requirement: 1. Post the transaction to the respective accounts. 2. Prepare the Trial Balance. Exercise 2 1. What is a purchase account? 2. What is recorded in the sales account? 3. How the purchase account and sales accounts transactions recorded in the Income Statement? 4. How the inventory account is reflected in the Balance Sheet? 5. What is the formula for cost of goods sold? 6. What is the difference between discount received and discount allowed? 7. Compare the difference between revenue expenditure and capital expenditure. 8. What is the difference between carriage inwards and carriage outwards? 9. What is return inward and its treatment? 10. What is return outward and its treatment